Pre-merger notification

Pre-merger notification is what happens after a deal has been found notifiable. Instead of closing and reporting later, the parties tell the Competition Bureau first and give it time to review. It matters to buyers of larger small and medium businesses, because the waiting period sets a point before which closing is prohibited unless the Bureau grants a waiver. Whether a deal is notifiable is a separate question, covered under the notification threshold.

How the process runs

Section 114 of the Competition Act says that, subject to Part IX, the parties to a proposed transaction of a kind described in section 110 shall, before it is completed, notify the Commissioner that it is proposed and supply the prescribed information. The Competition Bureau explains that a complete notification starts an initial 30-day waiting period, and that during it the parties are prohibited from completing the merger unless the Bureau grants a waiver. If the Bureau needs more, it can issue a Supplementary Information Request, and the parties may not close before a subsequent waiting period expires. The Bureau says that second, 30-day period begins once it has received the parties’ certified complete responses.

What to check or ask

• Whether the purchase agreement makes the waiting period a closing condition
• Who prepares the filing, and what information each side must supply
• How the closing date allows for a possible Supplementary Information Request

See also closing condition.